Iran energy

Iran: Nuclear talks to continue in Geneva

November 19th 2013 | Iran | Nuclear

Event

Iran and world powers are preparing to meet again for nuclear talks.

Analysis

Negotiators from Iran and the P5+1 (the permanent members of the UN security plus Germany) will reconvene in Geneva on November 20th, seeking to overcome differences that stymied an agreement earlier in November over Iran's nuclear programme. After the media circus surrounding the last round—when the foreign ministers of the P5+1 arrived in Geneva apparently to ink an agreement—this week's talks will be carried out between less senior politicians, although Mohammad Javad Zarif, the foreign minister, is set to lead the Iranian team. The P5+1 are expected to ask Iran to suspend the enrichment of uranium to 20%, reduce its stockpiles of enriched material and freeze work at the Arak heavy water facility, which, when finished, would allow the production of plutonium, a potential weapons fuel, as a waste product of reactions. In return, Iran would be offered access to funds frozen abroad.

However, the failure to achieve a deal in the last talks means that opponents to diplomacy have had additional time to voice their objections. The Israeli government remains strongly opposed to any agreement that does not include a dismantling of Iran's nuclear capacity. Israel's prime minister, Binyamin Netanyahu, hosted the French president, François Hollande, on a state visit this week and both leaders reiterated their opposition to a deal that eases sanctions on Iran without significant concessions. A former Israeli national security adviser, Yaakov Amidror, said that Israel would consider a unilateral strike against Iranian facilities if it felt diplomacy was leaving it isolated. In addition, the US president, Barack Obama, faces significant opposition from the Congress over his administration's softening policy towards Iran.

There have been signs of disagreement within the P5+1, with France apparently taking a tougher line than the US in the last set of talks. But Russia and China are likely to press for an agreement: both powers distanced themselves from the stringent sanctions introduced last year by the US and the EU that have halved Iran's oil exports. Russia's foreign minister, Sergei Lavrov, said that after the last round of talks that Iran was willing to move "at a much faster speed than expected" and has subsequently warned against imposing "further conditions" on Iran.

Impact on the forecast

We believe that there is a strong likelihood of an interim deal being struck by the end of 2013 and will reflect the moderating tensions in our next assessment on Iran. However, we expect a grand bargain that addresses all Western concerns over Iran's nuclear programme to be harder to achieve and do not expect it in the near term.